Conservatives playing long game on daily Morneau attacks, Liberals accuse Tories, NDP of an ‘unholy alliance’

Hammering away at the finance minister, even without a ‘smoking gun,’ will chip away at the Liberals’ image and distract from their message, say Conservatives.

Conservative MP Pierre Poilievre, left, has been leading the Conservative attack on Finance Minister Bill Morneau, over allegations of at least the appearance of a conflict of interest for the finance minister. Conservative insiders say they think that attack will pay off in the long run.

The Hill Times photographs by Andrew Meade

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The federal Conservatives will keep hammering away at the ethical controversy surrounding Finance Minister Bill Morneau in the coming weeks as part of a long-term strategy, planting seeds for the next election campaign and taking the Liberals off message, say Conservatives.

“We will keep pushing. The Canadian people want to have somebody who is in charge of all the finances in the country, they have to have integrity. They have to be trustworthy and they have to not be using the information they get in their job for anything other than the good of the Canadian people,” said rookie Conservative MP Marilyn Gladu (Sarnia-Lambton, Ont.), adding that it takes a while to attract the attention of people on individual political or policy issues.

“I was surprised when I first came to Parliament because I’d say, ‘Why do we ask the same question 21 times? Isn’t once enough?’ and they’d say, ‘No, it takes months, actually sometimes, for it to percolate out to the average Canadians.’ So, we’re going to keep at it because Canadians need to know.”

Ms. Gladu agreed that strategically speaking, the longer the Liberals are on the defensive on ethical issues, the better it is for the opposition parties, because the Liberals will not be able to focus on their own agenda. But, more importantly, she said, Mr. Morneau holds one of the most important positions in the country and Canadians deserve the highest standards from their finance minister.

Conservative MP Marilyn Gladu said it can take months for regular Canadians to become aware of lines of questioning in Parliament. The Hill Times photograph by Andrew Meade

“This is the top priority. You have to have integrity at the top,” said Ms. Gladu.

Michele Austin, a consultant at Summa Strategies and former Conservative strategist and Hill staffer, said the goal for the Conservatives is to keep negative stories about Mr. Morneau and the Liberals in the news for as long as possible.

“They want to give this story legs,” she said.

The Conservatives don’t appear to have made major gains in the polls during the last month of attacks against Mr. Morneau, most recently over his sale of shares in his former company in 2015 shortly before a Finance Canada announcement that coincided with a drop in the value of those shares. Nanos Research polls have shown the Liberals ahead of the Conservatives by about seven or eight percentage points since mid-October. Polls by Abacus Data are similar.

Ms. Austin said the Conservative attacks were not necessarily about increasing polling figures in the short term.

“These things take a long time,” she said. “This is the first crack in the armour for the Liberals.”

Yaroslav Baran, a principal at Earnscliffe Strategy Group and a former Conservative staffer, said he thinks the Conservatives have played their hand well with Mr. Scheer calling for Mr. Morneau’s resignation after a “slow and steady build” that followed “several months of different potential conflicts of interest compounding each other that culminated in that move.” He noted it’s the first time since the Trudeau government was elected to power that the Conservatives have called for a ministerial resignation.

“Mr. Scheer realizes that you can’t issue that kind of demand lightly,” he said.

Mr. Baran said both the opposition and the government have been focused on communications rather than legalities in the way Mr. Morneau has been criticized and defended, respectively, with “high drama” from both sides.

“Both sides know that their rhetoric right now is upping the ante, and I guess the question that comes out of this is: where does it go from here?” said Mr. Baran.

“Right now we’ve got two people on a collision course with each other, we’ve got the finance minister and we’ve got the finance critic…and there’s going to be a collision and we don’t know which is going to be left standing at the end of this.”

Ms. Austin said she wouldn’t advise anyone to start a battle of political drama with Conservative finance critic Pierre Poilievre (Carleton, Ont.).

“If there’s theatre in politics, Pierre knows how to play it beautifully.”

‘They needed to take a swing’

Liberal MP Kevin Lamoureux (Winnipeg North, Man.), parliamentary secretary to the government House leader, in an interview with The Hill Times, accused the Conservatives and the NDP of forming an “unholy alliance” to discredit Mr. Morneau. He said the opposition parties don’t have anything of substance to hold the government to account on the economy, so they are trying to target the minister. Mr. Lamoureux said that no matter how many times the opposition parties repeat their accusations, he does not believe that Mr. Morneau is in a conflict of interest.

“There’s a sense between the two of them that, look, they don’t have anything of substance with the government on the economic front, and they believe that this unholy alliance will score points for them in the long run,” said Mr. Lamoureux. “I disagree.”

“It seems they don’t have any reservations in terms of slinging in the gutters and throwing mud and it’s because they don’t have anything, in my opinion. They’re not recognizing exactly what it is that this minister of finance has actually done for the country.

“People can’t help but respond positively to Bill. I have no problems whatsoever [in sharing with his constituents] what Mr. Morneau has actually done for the country. I do not believe he’s in a conflict. He’s following all of the rules.”

Warren Kinsella, president of Daisy Consulting and a former Liberal strategist including to former prime minister Jean Chrétien during his time in opposition, said he thinks the Conservatives have misplayed their hand in calling for Mr. Morneau’s resignation last week.

“You don’t haul out your leader to demand a resignation unless you’ve got all the proof you need to justify that, because you can’t make that request twice,” he said. “Their evidence was kind of a lot of the same evidence that they’ve been rolling out for some weeks…where’s the smoking gun?”

Mr. Kinsella said he thinks while Mr. Morneau has been “knocked around” by the opposition’s line of attack, he thinks calling for the minister’s resignation at this point “actually hurt Scheer.”

“They called for an investigation [by the ethics commissioner] and before it’s even complete they’re demanding the resignation,” he said.

The Conservatives for weeks have levelled criticism and questions over Mr. Morneau’s ethics disclosures, and now the sale of Morneau Shepell shares. Mr. Kinsella said he thinks the sustained, intense focus in part comes down to a lack of positive movement in polls.

“A new leader is supposed to have a honeymoon [in the polls]—Scheer didn’t get one,” he said. “They needed to take a swing.”

Allegation of insider trading unlikely to come

Although NDP MP Nathan Cullen (Skeena-Bulkley Valley, B.C.) mentioned insider trading in the House, the opposition has yet to actually accuse the finance minister of anything specific inside or outside of the House.

Mr. Morneau defended himself in a statement to reporters last week saying, “I’m hearing that shares that I sold after I got into office, around the time I got into office, was somehow something inappropriate.”

“All I can say is you literally cannot make this up. It is absolutely absurd,” he said.

After previously threatening legal action against the opposition if they accused him of something outside of the Chamber, Mr. Morneau called their bluff during Question Period Nov. 30, challenging the Conservatives to make a direct accusation inside the House, where they would be protected from a defamation suit. The Conservatives didn’t do so, continuing to ask questions around the subject of the timing of Mr. Morneau’s sale of shares in Morneau Shepell in 2015.

Mr. Poilievre, who has been leading the charge for his party in Question Period against the finance minister, likely would have an understanding with the Conservative Party about the legal implications of doing so, said Ms. Austin.

In the event of a lawsuit, “generally parties pay for these things,” she said.

Conservative Party spokesperson Cory Hann did not directly answer when asked by The Hill Times whether such an understanding existed, instead saying in an emailed statement that the Liberal threats of legal action were a “deflection tactic.”

Any allegation of insider trading against Mr. Morneau would likely be incorrect.

Insider trading requires the person doing the trading to have a special relationship with the company involved, which could include employment, serving on the board of directors, or holding more than 10 per cent of the shares in the company, said Jeffrey MacIntosh, a law professor at the University of Toronto specializing in corporate law and securities regulation.

Mr. Morneau does not appear to fit any of those criteria, as he is not currently employed by or serving on the board of Morneau Shepell. Reports by the Globe and Mail and National Post indicate that Mr. Morneau owned about two million shares in Morneau Shepell before the sale of shares in late 2015 that the Conservatives are questioning. Morneau Shepell had roughly 48 million outstanding shares at that time, putting the finance minister’s holding well below the 10 per cent threshold.

In any case, “I haven’t seen anything said inside the House that would be actionable outside the House,” said Mr. Baran.

“It’s really a whole lot of drama on both sides at this point. It’s not about legalities, it’s about drama.”

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